Jeffrey Sachs on Trump's Economics: Populism Won't Save the Rust Belt | Big Think

Jeffrey Sachs on Trump's Economics: Populism Won't Save the Rust Belt

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The Rust Belt was promised a lot this election – will those promises, which are now transitioning into policies, be made good? Economist and UN advisor Jeffrey Sachs is a Rust Belt native himself, and believes it’s in the hands of people in that area to take an informed look at the economic proposals of the Trump administration – will these proposals benefit the average person, or is there misdirection and populist scapegoating at play that will only serve to make the rich richer? Sachs provides some red markers to watch for when listening to policy proposals, and offers a question to keep in mind: "Who is going to pay for that tax break?" It may not be the answer the people of the Rust Belt signed up for. Jeffrey Sachs's most recent book is Building the New American Economy: Smart, Fair, and Sustainable.
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JEFFREY SACHS :

Jeffrey Sachs is is an American economist and co-founder and chief strategist of Millennium Promise Alliance, a nonprofit organization dedicated to ending extreme poverty and hunger. He is also the former director of The Earth Institute at Columbia University, where he holds the title of University Professor, the highest rank that Columbia bestows on its faculty.
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TRANSCRIPT:

Jeffrey Sachs: If you’re from the rust belt the first thing I would say is so am I. I’m a Detroiter. And so I understand the situation in the rust belt and it’s a bad situation. Now Donald Trump won votes there by saying I’m going to fix your situation and he said how he proposes to do it. He said you’re suffering because China has taken advantage of us, bad trade deals because of migrants in our country, because of Mexico and NAFTA and our jobs going overseas and so forth. 
I’d give that a rounded D, you know. Probably passing for effort but obviously didn’t do much reading and doesn’t really understand economics very much. The first thing I would say is, “Donald, you’re my student. Didn’t you read about the widening income inequality in the country – that as those voters in the rust belt are suffering your buddies, the billionaires that you put in the cabinet they’re having the time of their lives. How about remembering that in your essay?"
The point I would say to the rust belt is you have now heard the words of a typical populist. A populist looks at a real problem and says it’s the foreigners that caused it. It’s the other people that caused it. A populist always is looking for misdirection for the enemy. It’s kind of like a magic act where the magician tries to make you look over here while they’re stealing out of your pocket on the other side. That’s what’s going on in America right now.

The problem with populism is it doesn’t work. So he may try to beat up on China, good luck to us. We could end up with a real global crisis if they try that. He could try to beat up on Mexico. Probably a little bit more success in the sense of doing harm to others but we’d have a pretty bad backlash as well. But what he can’t do is solve your rust belt problems that way. That he can’t do 
So I would say, you know, now it’s your turn to grade the paper because you’re going to be watching Donald turn in weekly exam papers and so you’re going to have to be grading him. Who are the beneficiaries of his actions? Are the rich going to get richer? How many jobs do you really think are coming home? If Ford says, “Okay, we won’t invest in Mexico, we’ll invest in the U.S.” and that creates 700 jobs for a $700 million investment, one job per million dollars. How far are we going to get that way? 

You’re going to be the graders now and I would say think hard and seriously. Are you watching gimmicks? Are tweets going to solve your problem or are you hearing solutions that are not solutions for a few rich people but are solutions for you? And one more thing I would recommend to Americans. He’s going to come across and say, “I’m going to cut your taxes and I’m going to cut the rich people’s taxes. I’m going to cut everybody’s taxes.” And Americans will say, “Whoa, that’s wonderful. That’s great.” But then they should think for a moment. “Okay, well isn’t that going to raise the deficit? Okay, isn’t that going to be a lot of more public debt? Yeah. Who’s going to pay for that? My kids?” Or if you’re a young millennial; “I’m going to pay for that! What the heck is that – giving tax breaks to 70-year-old friends of our 70-year-old president and leaving...

[Wordavee]

China didn't FORCE US companies to have their products made overseas. If there are lousy deals made with China, it's the fault of the US dealmakers, not the Chinese!!

[Hermit-Crab]

An honest man, an economist with a conscience.

[TheCortexReaver]

I can't believe that he's suggesting that a rich spoiled brat who inherited everything, went bankrupt, got bailed out, and then he was in TV doesn't have the skills to resolve problems of USA :-o

[mrbroeders]

What Americans need is a dose of reality. We went through a similar process in the UK - manufacturing was falling as was demand for steel, coal etc. The country went through a rethink to understand that we could no longer compete in the same way as we did before. You can't just prop up failing industries - you have to find different ways. So we worked on high quality steel for special requirements (for example) and looked at re-training to help people develop new skills to remain employable. Trump has taken the wrong approach - tariffs and trade wars will hurt American workers more and will cost the taxpayer billions. Better to spend that money on developing new industries and providing incentives for new technology companies to move to the Rust Belt instead.

[cameronsipka]

make sure trump's actions actually benefit the American people. so far all he's done benefits his rich friends.

[KalElKryptonsFinest]

Corporations move from high wage zones to low wage zones because they aren't beholden to employees they are beholden to owners for dividends. This is not an reversible ethos, much like thermodynamic law.

[shinlanten]

It's a lot easier to blame *_someone_* (i.e. China, Mexico, Foreigners, etc.) than it is to blame *_something_* (i.e. automation, technology, etc.) for job losses.

[darkofius]

Professor dr. Jeffrey Sachs is intellectual and an economist extraordinaire of our time, we should not only listen to him but...my deepest respects professor...

[MrKAHutch]

The Rust Belt/manufacturing in the U.S. was destroyed, because of employers being on the hook for employees health care, which forced companies to automate, to avoid labor costs.

-Former Dayton, Ohio resident

[ForAnAngel]

Let's all remember that Obama cut the deficit by 2/3 (from $1.4 trillion to $.4 trillion) during his presidency.

[ticnatz]

What an embarrassment to the nation. All empires fall, some faster than

[edsmelly]

I truly believe that Donald Trump, and the rest of the Conservatives in Congress, understand that his anti-China, anti-immigrant, anti-trade policies won't do shit to help people in struggling states. But he's telling people what they want to hear, what they want desperately to believe. Because blaming China and immigrants for your problems is a whole lot easier than actually doing something to better your life.

[Wordavee]

What deal did Trump make to have his 'Make America Great Again' hats made in China?

[jacqueline]

Left wing populism is what could help the rust belt, but not right wing populism.

[jeffcolorado]

I was hoping this guy would offer his suggestions for saving the "rust belt".

[FractalSpiral]

He's got a very interesting definition of populism, that's for sure. I agree that Trump isn't on a road to fixing the Rust Belt, but Mr. Sachs seems to be conflating Populism with Nativism. They often go hand in hand, but they are separate philosophies.

[kds]

I don't qualify for tax cuts, I make too much. So my average federal is $15K to $20K. It irks me.

[cybersekkin]

Pay no attention to us business leaders moving jobs overseas, that has nothing to do with your poor economic status. Let's all blame this weeks scapegoat instead.

[ericzipf]

Unfortunately, the people that need to see videos like this, never do.

[Pledditor]

big think sure never puts any pro-trump voices on here